Grain Alcohol Market Size, Share, Industry Analysis, Trends, Growth, 2030

Grain Alcohol Industry Prospective:

The global Grain Alcohol market size was worth around USD 12.5 billion in 2022 and is predicted to grow to around USD 17.7 billion by 2030 with a compound annual growth rate (CAGR) of roughly 4.5% between 2023 and 2030.       

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Grain Alcohol Market: Overview

One type of alcohol produced from fermented grain is called grain alcohol. It is sometimes referred to as ethanol or ethyl alcohol. The primary component of alcoholic drinks including wine, liquor, and beer is grain alcohol. In addition, it serves as an antibacterial, a solvent, and a fuel. Fermentation, the process of employing yeast or bacteria to turn carbs into alcohol, is what creates grain alcohol. Typically, grains like rice, maize, and wheat provide the carbs. Beverage products such as wine and beer are made through the fermentation process. Grain alcohol has a distinct smell and is a clear, colorless, flammable liquid. It has a boiling point of 78.5 degrees Celsius and is soluble in water.

Key Insights

• As per the analysis shared by our research analyst, the global Grain Alcohol market is estimated to grow annually at a CAGR of around 4.5% over the forecast period (2023-2030).
• In terms of revenue, the global Grain Alcohol market size was valued at around USD 12.5 billion in 2022 and is projected to reach USD 17.7 billion, by 2030.
• The growing consumption of alcohol across the globe is expected to drive the grain alcohol market growth over the forecast period.
• Based on the type, the polyols segment is expected to hold the largest market share over the forecast period.
• Based on the application, the beverages segment is expected to dominate the market over the forecast period.
• Based on region, Europe is expected to hold the largest market share over the forecast period.

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Grain Alcohol Market: Growth Drivers

Increasing consumption of alcoholic drinks drives market growth

The rising use of alcoholic beverages is propelling the grain alcohol industry forward. The rise in consumption of these beverages can be attributed to a variety of causes, including greater disposable income and a more urban population. According to the US government, there will be a 60% rise in drinking in 2020 compared to pre-pandemic levels. The primary causes of increased drinking are increased stress (45.7%), greater alcohol availability (34.4%), and boredom (30.1%). Per capita alcohol consumption is anticipated to climb from 5.9 liters per year in 1990 to 7.6 liters in 2030. As a result, the growing use of alcoholic drinks propels the grain alcohol industry.

Grain Alcohol Market: Restraints

Negative consequences of consuming alcohol impede grain alcohol market growth

The health ministries of several nations, including Brazil, Australia, the US, and India, have taken action to mitigate the negative consequences of alcohol use. Due to the extreme price sensitivity of the alcohol industry, even a slight increase in price by the government or other regulatory bodies can have a significant effect on the amount consumed. For instance, every year, alcohol usage results in 2.8 million premature deaths worldwide. This might thus have a detrimental effect on the market for grain alcohol used in beverage applications, lowering demand.

Grain Alcohol Market: Opportunities

Growing collaboration offers a lucrative opportunity for market growth

The growing collaboration by the key players is expected to offer a lucrative opportunity for grain alcohol market growth over the forecast period. For instance, in October 2023, the Coca-Cola company declared its intention to join the market for alcohol that is ready to drink. It is collaborating with Pernod Ricard to introduce Absolut Vodka & Sprite. By 2024, the beverage will be offered in a few European nations in addition to the UK, the Netherlands, Spain, and Germany. Moreover, in April 2021, Luxco, Inc. was acquired by MGP Ingredients, Inc., a US-based distributor of specialized wheat proteins and starches as well as premium distilled spirits. The purchase is consistent with MGP's long-term strategy, which focuses on diversifying the company portfolio and moving toward greater value-added goods. The leading manufacturer, distributor, importer, and bottler of drinking alcohol products is Luxco, a US-based business.

Grain Alcohol Market: Challenges

Volatility in the price pose a major challenge to market growth

Variations in the product's quality and raw material availability impact the cost of food-grade alcohols. The increase in the cost of raw materials has been one of the main issues facing the market for food-grade alcohols. The cost of ingredients has been unpredictable in recent years, and it is expected that this trend will continue in the years to come. There is uncertainty about the amount generated since ethanol-producing crops including wheat, corn, and barley have fluctuating prices.

Grain Alcohol Market: Segmentation

The global Grain Alcohol industry is segmented based on the type, application, source, functionality, and region.

Based on the type, the global market is bifurcated into ethanol and polyols. The polyols segment is expected to hold the largest market share over the forecast period. Sorbitol, maltitol, xylitol, mannitol, and erythritol are a few of the several polyols that were taken into consideration for the study. A polyol, or sugar alcohol, sorbitol is a low-calorie sugar. It naturally occurs in foods like prunes and apricots. It can be used as a bulk sweetener, to retain moisture in goods, and as a component in medications, chewing gum, and sugar-free candies. A kind of sugar alcohol called maltitol is used to replace table sugar since it is lower in calories, less likely to induce tooth decay, and less likely to affect blood sugar levels. The development of this market is anticipated to be driven by the numerous uses of polyols in the food and beverage sector.

Based on the application, the grain alcohol industry is bifurcated into food, beverages and pharmaceutical & healthcare. The beverages segment is expected to dominate the market over the forecast period. Beer, wine, spirits, and other beverages such as premixes, cider, and Perry are all included in the beverages section. After water and tea, beer is the most consumed alcoholic beverage globally and the third most popular drink overall. Global beer consumption is primarily fueled by rising disposable income, rising beer quality, more marketing and advertising, and a population that has been drinking beer continuously increasing. After fermenting grapes or other fruits, wine is produced. Spirits are fermented alcoholic beverages made via the distillation of ethanol from grains, fruits, or vegetables. Distillation is the process used to raise the ethanol content of spirits over that of the original fermenting combination. The beverage segment is expected to develop at the greatest pace throughout the projected period due to the fast-increasing demand for alcoholic beverages and the growing production of the same.

Based on the source, the global grain alcohol industry is bifurcated into sugarcane, grains, fruits, and others.

Based on the functionality, the global market is bifurcated into preservatives, coloring/flavoring agents, coatings, and others.

Grain Alcohol Market: Report Scope

Grain Alcohol Market: Regional Analysis

Europe is expected to hold the largest market share over the forecast period

Europe is expected to hold the largest grain alcohol market share during the forecast period. The European grain alcohol market is the largest in the world, with consistent and attractive growth despite relatively high levels of per capita use. The large food and beverage business in Europe offers the grain alcohol market a big customer base and growth prospects. It is anticipated that the sector in this region will grow as the nations of Eastern and Southeast Europe develop. The food industry prefers sugar polyols because of the growing demand for low-calorie goods; they are similar to sugar but contain less calories.

On the other hand, the Asia Pacific is expected to grow at the fastest rate over the forecast period. The Asia Pacific area is renowned for its urbanization and dense population, both of which have increased food and beverage consumption. Because of this, the grain alcohol market has the opportunity to improve its standing in the food and beverage sector by introducing fresh, innovative alcohol products that satisfy evolving demands from producers and final consumers.

Grain Alcohol Market: Competitive Analysis

The global Grain Alcohol market is dominated by players like:

• Archer-Daniels-Midland Company
• Cargill Inc.
• Kweichow Moutai
• Roquette Fr res
• MGP Ingredients Inc.
• Cristalco
• Wilmar Group
• Manildra Group
• Glacial Grain Spirits
• Wuliangye Yibin Co.
• Diageo PLC.
• Altria Group
• Pernod Ricard
• ChemCeed
• Ethanol US
• NuGenTeca
• Pinal Energy

The global Grain Alcohol market is segmented as follows:

By Type

• Ethanol
• Polyols

By Application

• Food
• Beverages
• Pharmaceutical & Healthcare

By Source

• Sugarcane
• Grains
• Fruits
• Others

By Functionality

• Preservative
• Coloring/Flavoring Agent
• Coatings
• Others

By Region

• North America
  • The U.S.
  • Canada
• Europe
  • France 
  • The UK
  • Spain
  • Germany
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • South Africa
  • Rest of Middle East & Africa